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Clean Air Council v. Dragon International Group

July 28, 2006

CLEAN AIR COUNCIL AND ALL SIMILARLY SITUATED INDIVIDUALS, PLAINTIFFS
v.
DRAGON INTERNATIONAL GROUP, DAVID WU, EDGE LLC, AND DAVID STEIN, DEFENDANTS



The opinion of the court was delivered by: William W. Caldwell United States District Judge

MEMORANDUM

I. Introduction

Plaintiff, Clean Air Council (CAC), filed this suit in the Court of Common Pleas of Dauphin County, Pennsylvania, against defendants, Dragon International Group, David Wu, Edge LLC, and David Stein. The state-court amended complaint alleges that Wu is a principal in control of Dragon, Stein is a principal in control of Edge and all four defendants are alleged to have caused two unsolicited faxes to be sent to CAC's fax machine.

CAC makes six claims, three under the Telephone Consumer Protection Act of 1991 (TCPA), 47 U.S.C. § 227, two under state law for conversion and trespass to chattels, and one against defendant Wu to pierce the corporate veil. Plaintiff wants this case to proceed as a class action, so it seeks damages on behalf of itself and "all similarly situated individuals."

Defendants removed the action to this court, asserting that we have diversity jurisdiction under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. § 1332(d), diversity jurisdiction under 28 U.S.C. § 1332(a) and federal-question jurisdiction under 28 U.S.C. § 1331.

We are considering Plaintiff's motion to remand. The motion argues that we have no federal-question jurisdiction because the TCPA places exclusive jurisdiction of private TCPA claims in state court; we have no class-action diversity jurisdiction under CAFA because Defendants have failed to show that the amount in controversy exceeds $5 million, as required by section 1332(d); and we have no section 1332(a) diversity jurisdiction because CAC's damages do not exceed $75,000.

II. Background

The amended complaint alleges the following. CAC is a non-profit organization with offices in Harrisburg, Pennsylvania. (Am. Compl. ¶ 1.) Defendant Dragon is a corporation with a mailing address in Las Vegas, Nevada, (id., ¶ 2), and defendant Wu is a principal in Dragon with control over it. (Id., ¶ 2.) Defendant Edge LLC is a corporation with a mailing address in Boca Raton, Florida, (id., ¶ 4) and defendant Stein is a principal in control Of Edge. (Id., ¶ 5.)

The notice of removal supplies the information that CAC's principal place of business is in Harrisburg, Pennsylvania (Notice of Removal, ¶ 1); that Dragon is incorporated in the state of Nevada with its principal place of business in the People's Republic of China (id., ¶ 2); that Wu is a resident and citizen of the People's Republic of China (id., ¶ 3); that defendant Edge is incorporated in the state of Florida and has its principal place of business in the state of Florida (id., ¶ 4); and that Stein is a resident and citizen of the state of Florida. (Id., ¶ 5.)

The amended complaint alleges that the defendants caused two faxes to be sent to CAC's fax machine on or about April 11, 2005, and May 2, 2005, that advertised Dragon's stock. CAC had not consented to receive the faxes, and neither fax had complete information at its top or bottom to identify the sender, as required by law. (Am. Compl. ¶¶ 9-15.)

The first five counts name all the defendants and seek to represent a class of "All Similarly Situated Individuals." In count I, Plaintiff makes a TCPA claim for a violation of 47 U.S.C. § 227(b)(1)(C), which makes it illegal to send unsolicited faxes. As authorized by section 227(b)(3)(B), this count seeks statutory damages of $500 for each unsolicited fax sent. In count II, Plaintiff makes a TCPA claim for a violation of 47 U.S.C. § 227(d)(1)(B), which makes it illegal not to include the originator's identifying information on a fax. Plaintiff alleges that it incurred costs of $350 to identify the sending parties and seeks this amount as additional damages for each unsolicited fax. In count III, Plaintiff alleges the violations of the TCPA were willful and knowing and seeks statutory damages for such a violation of the TCPA under section 227(b)(3) of three times the $500 statutory damages for a total of $1,500 for each violation. In count IV, Plaintiff makes a state-law claim for conversion of its electricity, ink, paper and other resources for the unsolicited faxes and seeks damages in the amount of three dollars for each violation. In count V, Plaintiff makes a state-law claim for trespass to chattels for preventing Plaintiff from using its telephone lines and fax machine while the unsolicited faxes were being transmitted and for using Plaintiff's electrical power, paper and ink. It seeks three dollars in damages for each violation. In count VI, Plaintiff seeks to represent a class against defendant Wu alone and seeks to impose liability on Wu individually by piercing the corporate veil.

The amended complaint makes certain class-action allegations. In pertinent part, Plaintiff identifies the class as "all persons who received the same or similar fax as Plaintiff without providing the DEFENDANTS the specific authorization to send the same." (Am. Compl. ¶ 58.) Plaintiff alleges that:

Such solicitations are sent to tens of thousands of recipients. Therefore, the number of those similarly situated as Plaintiff, who received the fax sent by DEFENDANTS without specifically requesting the same or authorizing that the same be sent, will be so numerous that the joinder of all members is impracticable. (Id., ΒΆ 59.) In the ad damnum clause at the end of the amended complaint, Plaintiff ...


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